Paddick used his insider knowledge to depict the existence of a widespread fear of the tabloids among senior police officers and what he called a general "culture of cover-up" at the Met.

But the detailed allegations he and Prescott make about the hacking affair are even more startling. According to the evidence, lies appear to have been told not only to individual victims, but to government ministers, parliament, the judges and the public.

Police attempts to undermine the Guardian's reporting when it first disclosed the scandal in 2009 are shown to have been wrong. There had been a "conspiracy of silence", Prescott said.

According to the evidence presented on Monday:

• Police knew from the outset that Prescott was a hacking victim, but told him the opposite.

• Police immediately identified hundreds of hacking targets in the seized files of the private detective Glenn Mulcaire, but later claimed they were unaware of them.

• Police never received key financial evidence or computers from News International (NI).

• Police "tipped off" Rebekah Brooks, the then editor of the Sun, about the scope of their investigation.

• Police discovered in Mulcaire's files highly sensitive leaks from within their own ranks that could have endangered those with new identities.

• An unknown police officer reversed a recorded decision to inform key victims, ensuring a cover-up.

Some of the most senior officers who handled the case have already testified to MPs on the Commons media committee. They are being recalled under oath by Lord Justice Leveson later this week.

These include the former assistant commissioner John Yates, who has resigned and is currently employed as a consultant by the ruling family in Bahrain; the former deputy assistant commissioner Peter Clarke; and the former assistant commissioner Andy Hayman.

Police investigations were "thorough and appropriate" to start with, said Paddick. The NoW's royal reporter Clive Goodman was targeted in 2006 after members of the monarchy complained that their phones were being interfered with.

The documents reveal, however, that police realised from the outset that phone hacking was a potentially huge issue.

On 4 April 2006, Detective Superintendent Philip Williams wrote that the ability to intercept voicemails was "highly unlikely to be limited to Goodman alone" and could be too expensive to investigate by the royal security squad.

In May, after Mulcaire had been linked to the case, the case officer Mark Maberley wrote of "sophisticated and organised interception of voice messages".

His senior investigating officer, Keith Surtees, proposed that "given the large number of non-royal victims" a better-equipped squad should take over. Paddick said he did not understand why this never happened.

The team then discovered that the then Labour cabinet minister Tessa Jowell was being hacked. When Mulcaire's property was raided on 8 August 2006 they found that Prescott was also being targeted.

A transcript of Mulcaire's interrogation on the following day was revealed on Monday. Prescott said he found the transcript "quite staggering" when it was eventually disclosed to him five years later.

The interrogator, DC Gallagher, was recorded saying: "Another page here has got the name John Prescott. There's another name underneath, first of all it says adviser and then the name Joan Hammell. You've got her telephone numbers and DI numbers, password numbers and Vodafone passwords … and an address."

Police regarded the Prescott allegation as so significant in 2006 that they included his name in a draft application for a search warrant for the NoW, which was never executed.

The draft said Mulcaire had been receiving extra payments of £250 a time "which appear to be linked to assistance given in relation to specific stories". It added: "The details contained in these invoices demonstrate these stories involve individuals in the public eye such as … 'Prescott'."

The evidence police already held included two £250 bills Mulcaire presented to NI dated 7 May 2006 and 21 May 2006. One said: "Story – other Prescott assist – TXT" and the other: "Story: Other Prescott assist – TXT: Urgent".

Other damning evidence which later came to light, and would have been discovered had police pursued inquiries at the time, included an internal NI email dated 28 April 2006. It was headed "Joan Hammell: adviser to Prescott", gave instructions on how to access her voicemail box and said there were 45 messages to be listened to.

But police did not push ahead. There was a "tense standoff" at the News of the World offices when police arrived, according to the case officer. Stuart Kuttner, the managing editor, and the Farrers solicitor Julian Pike met police and allegedly "obstructed" them. The accounts department was not searched as intended, nor were Goodman's safe and computer taken away.

The paper's lawyers continued to stall and refuse to provide documents, and falsely claim to be co-operating, according to Paddick. Police never served a planned production order to "identify other individuals" who had committed offences.

Paddick said: "It is not usual that a suspect would be permitted to fob the police off in this way."

Nevertheless, by 10 August 2006, police had identified "hundreds of individuals including royals, MPs, sports stars, military, police, celebrities and journalists" among the NoW's victims. A printed analysis with names, addresses and contact details of 418 of them had been prepared.

In summer 2006 a decision was recorded in the decision log to warn all the victims, especially those such as politicians, military and police, where there were security concerns.

But this decision was reversed, with no record kept of the reversal. Only a "tiny fraction" of victims were ever told, with Paddick and Prescott among those kept in the dark.

Paddick said: "I have no idea … who made that decision."

According to Paddick, police also went on to "tip off" Rebekah Brooks about the limited police strategy that had been decided upon. On 15 September 2006, a conversation between Brooks and "cops" is described in an internal NI email.

According to the email, police reassured Brooks that the Met would not widen the hacking case to include other NoW people, as long as no more direct evidence was forthcoming.

"The MPS [Metropolitan police service] were effectively tipping [NoW] off and [they] could do then, as indeed they did, avoid providing evidence of the involvement of other journalists," Paddick said.

The contents of Brooks's conversation were passed to Andy Coulson, then NoW editor, by the paper's lawyer Tom Crone. All three subsequently falsely claimed that hacking was limited to "one rogue reporter".

Police remained silent, and the facts were covered up until the Guardian disclosed in July 2009 that "public figures were targeted by investigators, including … John Prescott".

Prescott said he was "astonished" and wrote to the Met. Yates rang the then deputy prime minister in his car the next day to deny the Guardian's story. He went on to deny it at a press conference, saying: "This investigation has not uncovered any evidence that John Prescott's telephone had been tapped," and again to the home affairs committee on 7 September 2010: "He has never been hacked to my knowledge and there is no evidence that he has."

He insisted that every potential victim had been told "where we had even the minutest possibility they may have been the subject of an attempt to hack".

Hayman – by then employed by News International to write a column – claimed on the radio that Prescott was "ranting" and wasting public money. He also claimed police had "left no stone unturned".

Police then apparently misled a judge, according to the evidence given to Leveson, in an attempt to block Prescott's lawsuit against them. Permission to sue was initially refused in February 2011 because of a false assurance that there was no evidence Prescott's voicemail had ever been hacked. Not until 30 September were the documents finally disclosed.

Prescott told Leveson on Monday it was "deeply shocking" for him to find that police had "supported and assisted an organisation guilty of criminal behaviour". "They appear to have protected the perpetrators and misled the victims," he said.

Paddick said he was similarly misled. After writing personally to Yates he had originally been assured that "we have no documentation to suggest that [you] were subjected to unlawful monitoring or interception". He eventually discovered that his name and details as "police commander" were on one of Mulcaire's 320 computer "project lists".

Police also filed a misleading defence to Paddick's judicial review case, claiming there was no evidence about him and that the full Mulcaire material had not been examined because it was too "voluminous, chaotic and disorganised and difficult to decipher".

One of the documents now emerging is a witness statement from case officer Maberley. He disclosed that Mulcaire's "project list" included new identities of people in the witness protection scheme, such as the Bulger defendants. This included "people who had been given new identities by the police for their own protection".

Paddick said it must have been leaked by the police. If it reached the News of the World, "this could have serious consequences for those individuals".

It should have been handled with the utmost seriousness. But Mulcaire was never questioned about it, and because he agreed to plead guilty "the whole thing appears to have been covered up".

Paddick said the public might not be convinced by the renewed Met investigations, despite Akers's undoubted integrity, because News Corporation ultimately controlled what evidence was turned over, and Met officers were themselves allegedly heavily implicated in corruption.